Press Release             

Contact: Paul Precht
Director for Policy and Communications

March 25, 2008

Statement by Robert M. Hayes, President, Medicare Rights Center, on the Release of the Medicare and Social Security Trustees Report

"There have been dire warnings of the imminent insolvency of the Medicare hospital insurance trust fund before, and Congress has addressed them by making careful and measured adjustments to how Medicare pays for services. The Bush administration has rejected that approach and instead proposed draconian across-the-board cuts in its budget or measures that would shift more costs on to people with Medicare and undermine popular support for the program.

"The hospital insurance trust fund is not the key issue facing Medicare. The key issue is whether our nation believes that affordable health care should be a fundamental right for the American people. The central question is whether the government can stand up to the politically powerful industries that recklessly and needlessly drive up the cost of health care for all Americans. President Bush has failed to do so.

"This administration has vowed to veto legislation that makes modest reductions to the excess subsidies received by Medicare private health plans. These private plans cost taxpayers an average of 13 percent more per enrollee than it would cost to provide care under Original Medicare. The overpayments add up to nearly $160 billion over the next ten years.

"Overpayments to Medicare private health plans also add to the annual rise in the Part B premium, which is already $96.40 per month. The premium will likely be higher next year, if, as expected, Congress acts to avert pending cuts in Medicare payments to doctors. If Congress pays for adjustments to Medicare doctor payments by cutting subsidies to Medicare private health plans, however, any increase in the Part B premium would be greatly reduced.

"The rise in the Part B premium makes it even more important that Congress expand access to the Medicare Savings Programs1, which pay the Part B premium and other medical costs for people with low incomes struggling to get by on limited incomes."

[1]The Medicare Savings Programs are available to people with Medicare living below 135 percent of the Federal Poverty Level ($1,170 per month for an individual, $1,575 per month for a couple) who have limited savings and other financial assets. The Children's Health and Medicare Protection Act, which passed the House in 2007, would raise the income threshold to 150 percent of the Federal Poverty Level ($1,300 for an individual, $1,750 for a couple) and raise the asset thresholds to allow enrollment by people with Medicare who have modest savings.

Medicare Rights Center (MRC) is the largest independent source of health care information and assistance in the United States for people with Medicare. Founded in 1989, MRC helps older adults and people with disabilities get good, affordable health care.